The court upheld the 15-year recovery period for pension commutation value, emphasizing it prevents unjust enrichment while balancing pensioners' rights and financial sustainability.

JUDGMENT :

J.J. Munir, J.

1. The question of law involved in this batch of writ petitions is, if the commutation value of pension for an employee, who retires upon attaining the age of superannuation, invariably 60 years, deducted in monthly installments from his retirement pension, made good in the time period of 10 years and 8 months or 11 years, or at the most 12 years, can be recovered for the agreed or the stipulated period of 15 years provided under the relevant service regulations, leading the respondents to realize from the employee more than the commutation value paid?

2. Writ-A No.12596 of 2024 has been heard as the leading writ petition. The learned Counsel for the petitioners, apart from highlighting facts and figures individual to their cases, have mostly confined their submissions to the aforesaid question of law. As such, facts would be noticed from the leading petition.

3. The petitioner, Sudhir Kumar Agarwal, was a Senior Manager with the Indian Overseas Bank, Station Road Branch, Moradabad and retired from service upon attaining the age of superannuation on 31.01.2012. The Indian Overseas Bank (for short, 'the Bank') is a nationalized Bank..

4. Eschewing unnecessary detail, all that need be noticed is that the petitioner's pension fell due w.e.f. 01.02.2012. The basic average pay at the time of his retirement was Rs.36,400/-. Accordingly, 50% of the said sum of money, to wit, Rs.18,200/- was fixed as the basic pension + dearness allowance. The petitioner requested commutation of his pension to the extent of 1/3^rd, which worked out to a figure Rs.6,066/- per month. The aforesaid commutation was sanctioned and he was paid in lieu thereof a lump sum of Rs.7,14,090/-. It is the petitioner's case that the time period for recovery of the commutation value of pension paid to him was fixed at 15 years, when the petitioner retired. Recovery of the commutation value of Rs.7,14,090/- is made by a monthly deduction from the petitioner's pension in the sum of Rs.6,066/- + dearness allowance applicable. The petitioner is receiving a monthly pension of Rs.12,134/- + dearness allowance, that works to a figure of Rs.52,183/-, the dearness allowance being Rs.40,049/- per month. The case of the petitioner, like all others in this batch of petitions, is that upon deduction of the specified sum from his monthly pension, the commutation value would have been made good in the time period of 10 years and 8 months. Instead of settling the commutation account and releasing the petitioner's full pension at the end of 10 years and 8 months, the respondents insist that they would recover for the period of 15 years, agreed and settled at the time of commutation. The petitioner has appended a chart to the writ petition, marked Annexure No. 2-A, which shows that from 01.02.2012 to 31.07.2024, the Bank would have recovered from the petitioner at the rate of Rs.6,066/-, a sum of Rs.90,09,900/-. They would have recovered beyond the commutation value as on 31.07.2024, a sum of Rs.1,95,810/-. The submission, therefore, is that the sum of Rs.7,14,060/- paid to the petitioner as commutation value of his 1/3^rd pension, was to be recovered at the specified rate in 118 installments; 150 have already been recovered, falling back on the clause that